Canada Records Largest Two-Month Job Gain in More Than 30 Years

Canadian employment rose almost six times faster than economists forecast in April, led by private-sector and full-time positions, creating the largest two-month increase in more than 30 years.

Employment rose by 58,200 following a March jump of 82,300 that was the biggest since September 2008, Statistics Canada said today in Ottawa. The labor force grew by 72,500, lifting the jobless rate to 7.3 percent from 7.2 percent. Economists surveyed by Bloomberg News projected a 10,000 gain in jobs and 7.3 percent unemployment, according to the median forecasts.

Canada’s recovery may prompt central bank Governor Mark Carney to raise interest rates this year, leading the Group of 10 nations, according to Toronto-Dominion Bank. The Bank of Canada said last month higher borrowing costs may be needed because of faster-than-expected growth, while a report yesterday showed a fifth straight trade surplus.

The construction industry posted the largest increase with 24,600 new jobs. Manufacturing added 23,800 positions and education rose by 16,800.

Natural resources employment grew by 11,000 in April, leading all industries with a year-over-year increase of 12.5 percent, Statistics Canada said.

Largest Since 1981

The 140,500 increase in employment over March and April was the largest since January and February 1981, when 143,300 jobs were created, according to Statistics Canada.

Average hourly earnings of permanent employees rose 2.4 percent in April from a year earlier, slower than the prior reading of 2.5 percent. Both figures exceed the 2 percent inflation target set by the Bank of Canada, which says the wage measure is a key indicator of inflation pressure.

Workers classified as employees by Statistics Canada rose by 66,600 while the self-employed decreased by 8,400 in April.

Public administration work fell by 32,400 positions in April, Statistics Canada said, and retailing and wholesaling jobs fell by 18,400.

Finance Minister Jim Flaherty’s March 29 budget showed plans for 19,200 federal government job cuts, or 4.8 percent of the total, to help eliminate a budget deficit. About 7,200 of those reductions will come through attrition.